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LATEST REPORT: Nigerian Naira Worst 2024 Performing Currency 

By Adedayo Osho 

Nigeria's currency, the naira emerged as the worst-performing currency in the world in the first half of 2024.

A report by Bloomberg on Friday 28 June revealed factors ranging from devaluation, insufficient dollar liquidity, and market volatility hindered efforts by the Central Bank of Nigeria (CBN) to strengthen the currency.

Egyptian pound, Ghana’s cedi were also ranked as the world’s other worst performing currencies in the first six months of the year.

Data tracked from FMDQ by Bloomberg revealed the naira weakened for a ninth straight day to 1,510 per dollar by the close of business, last Thursday.

It was disclosed in the report that “The losing streak is the longest since July 2017 and takes the decline since the start of the year to 40 percent.

“The naira’s performance is the worst among global currencies tracked by Bloomberg beside that of the pound in Lebanon, which is undergoing an economic crisis and witnessing dollarization.,"

Analysing the performance of the currency, Head of Africa Strategy at Standard Chartered Bank Plc, Samir Gadio, wrote in a mail: “While the naira is undervalued and has seen significant adjustment, for the currency to remain supported, the supply of dollars needs to improve."

Samir added that "Portfolio inflows have yet to pick up, even amid still-attractive local rates," stressing "What will matter going forward is whether it can stabilise on improving foreign exchange inflows and perhaps see some appreciation."

PwC in its latest economic report on Nigeria, stated that the naira depreciated against the dollar by 67.8 percent, from an average of N461.1 in May 2023 to N1,433.80 in May 2024.

Financial analysts at PwC said “The depreciation took effect despite foreign exchange market reforms by CBN to achieve price discovery and attract liquidity to the market."

This March 2024, the naira emerged as the best-performing currency in the world. Surprisingly, the feat was reversed the next month in April.

Further analysis in the report revealed the naira was volatile between mid-April and May due to the imbalance between demand and supply for the greenback before the trend moderated in June on an improvement in dollar inflows.

Meanwhile, earlier this week, the CBN Governor, Olayemi Cardoso, stated that the worst of the naira’s volatility may be over.

The naira has traded in a narrow range between 1,473/$ and 1485/$ this month, according to FMDQ data compiled by Bloomberg.

That has sent its 10-day rolling volatility to the lowest in a year and its 100-day swings to the least since November.